Pets At Home sees 'particularly weak' festive footfall as retail gloom continues
Pets At Home sees 'particularly weak' festive footfall as retail gloom continues
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Pets At Home has reported a slump in its retail business over the festive period, citing deteriorating consumer confidence. The pet product giant, which operates hundreds of stores across the UK, noted a "more challenging UK consumer backdrop with particularly weak footfall from October". The broader retail sector has been under strain in recent months as pessimistic economic forecasts have made consumers more reluctant to part with their cash.
Furthermore, Labour's decision to hike companies' national insurance contributions, a tax levied per employee, is expected to hit the industry especially hard due to its reliance on lower-paid workers such as shop-floor staff. Pets At Home revealed it had experienced "a softer performance" in its retail business during the three months leading up to January 2. Overall revenue dipped by 0.2% compared to the previous year, although the company highlighted that its veterinary division expanded by nearly one-fifth, with an increase in people subscribing to its service.
This follows a warning from Pets At Home last year that the deceleration of a pandemic-induced surge in pet ownership would impact its profits. People rushed to purchase dogs and cats during Covid-19 lockdowns, but this trend has levelled off this year.
Lyssa McGowan, the company’s chief executive, stated in late 2024 that the company was averaging 15,000 puppy and kitten sign-ups per week at the time, a decrease from about 24,000 in 2023. Adam Vettese, an analyst at investment platform eToro, has painted a somewhat bleak picture for British retail in the current climate, especially for companies like Pets at Home: "It’s fair to say it isn’t the easiest time to be a UK retailer, with potentially huge employment cost increases looming, and Pets at Home is no exception.
